Members of the New Right Republican Party proclaim themselves to be defenders of the working class. I believe they mean it, even though many of them are the elite of the elite. And because many of them are lawyers, including Ivy League lawyers like running mate JD Vance, we can forgive them if they fail to understand that their economic policies hurt, not help, the working class.
Part of this change is because Republicans don’t believe they should remain the so-called party of big business. They’re right. It’s a sad fact that traditional Republican politicians confuse supporting free markets with propping up and protecting big banks and other corporations with subsidies and other financial support. Just because Democrats do the same thing doesn’t excuse Republican behavior.
A crucial first step to earning the title of the People’s Party is to eliminate all subsidies, bailouts, tax breaks, and other government perks for big corporations. Doing so will eliminate much of the prejudice against corporations, allow markets to do their thing, and allow all economies to rise.
I don’t see this coming from the new populists, but rather counterproductive “pro-worker” policies such as higher corporate taxes. Only flesh and blood people pay taxes, and corporations are not.
In other words, corporations don’t actually pay taxes. For example, they pass on corporate taxes to workers in the form of lower wages, to consumers in the form of higher prices, and to shareholders in the form of lower dividends and stock valuations (meaning workers’ pensions are worth less). It’s like a game of hot potato, except the potato is on fire and always falls into the laps of the people at the end of the queue – the very people that pseudo-populists claim to support.
Imagine workers’ surprise during election season when they find that wages are stagnating at a faster rate than politicians have predicted. “At least we got tough on business!” politicians will say, but workers end up tightening their purse strings even more.
Calls for industrial policy suffer from the same flaws. These arguments on the right are centered on supporting industries that are said to be essential to national security and on the desire to bring manufacturing jobs back to the United States, especially to areas hard hit by deindustrialization.
Even ignoring the fact that America’s industrial base is strong (productive capacity is at an all-time high), industrial policy necessarily involves the government handing out subsidies, tax credits, tariffs, and other privileges to a few powerful, well-connected corporations. This cronyism benefits most ordinary workers, is a waste of money for the politically powerful, and harms working-class taxpayers.
Just look at President Joe Biden’s industrial policy, which was aimed at ensuring American self-sufficiency in critical sectors like semiconductors, pharmaceuticals and advanced technology. Domestic subsidies for favored manufacturers cost between $1.2 trillion and $2.1 trillion. The administration likes to claim that the subsidies ultimately benefit workers, but companies, often big corporations and the wealthy, are making taxpayer money on projects they would have done anyway. For example, about half of the Inflation Reduction Act (IRA) projects were announced before the IRA was passed, and the private green market was booming even before the subsidies were in place.
In Washington DC, apparently, nothing says “power to the people” like funneling taxpayer money to big corporations. But let’s not forget the big show: tariffs. What better way to help ordinary Americans than by raising the cost of living?
Watch as prices of goods and services affected by the tariffs rise even further. Less competition in the market leads to a world where workers pay more for less. Unfortunately, these price increases hit low-income households hardest. It’s like a regressive tax, but with a populist bow on top of it. Then, when other countries retaliate with their own tariffs on American products, we end up playing everyone’s favorite trade war game. American exporters suffer, and productivity and economic growth slow.
Making America great again is all well and good, but what does that have to do with making everything more expensive for American producers, workers and consumers? The New Right boasts that it is the new workers’ party, but its signature policies will bring about rising prices and cronyism under the misleading banner of populism.
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